Cambridge Antibody Technology (CAT) has won its court battle with Abbott over royalties from Humira, the rheumatoid arthritis drug tipped for blockbuster status.

Shares in the UK biotech rose 25% on the day of the ruling, which more than doubled CAT's royalty rate and leaves Abbott owing it £12 million in back payments.

Abbott had cut its royalty payments to CAT to the legal minimum of 2%, arguing that it needed to do this to pay other companies involved in the later development of the monoclonal antibody treatment.

But trial judge Mr Justice Laddie ruled Abbott was not entitled to interpret the agreement this way, and said Abbott should have paid, and should continue to pay sales royalties of just over 5% of Humira's net sales from late 2003 onwards.

CAT originally discovered Humira, which it subsequently developed in collaboration with Abbott. Since its 2003 launch, the product has made significant sales progress and is anticipated to reach blockbuster status, Abbott forecasting sales of more than $1.2 billion in 2005.

Humira is being evaluated as a treatment for a number of other diseases, including juvenile RA, psoriasis, Crohn's disease and ankylosing spondylitis.

Abbott recently submitted Humira to the FDA for approval as a treatment for psoriatic arthritis, an autoimmune disorder that combines symptoms of psoriasis, such as dry, scaly skin with arthritis symptoms, including joint pain and inflammation.

The drug currently has a US and European licence to treat moderate to severe RA in adult patients when they show an inadequate response to disease modifying antirheumatic drugs (DMARDs), including standard treatment methotrexate.

Humira is the first fully human monoclonal antibody approved as a treatment for RA and the injectable medicine is proving a strong competitor for the more established drugs in its class, J&J's Remicade and Amgen/Wyeth's Enbrel.

Abbott has applied for permission to appeal, but this will not be heard before late January.